Russell and Comcare

[2000] AATA 243

CATCHWORDS – COMPENSATION – applicant a member of defence force who received shrapnel wound to left upper buttock – applicant elected under section 45 to pursue common law damages – applicant settled common law action – applicant developed major depressive disorder – whether election for shrapnel wound relates to depressive disorder as well – meaning of "injury", "impairment" and "in respect of" – whether depressive disorder an injury or an impairment – whether depressive disorder resulted from injury or employment – decision affirmed.

Safety, Rehabilitation and Compensation Act 1988 - ss 14, 15, 16, 17, 18, 19, 20, 21, 22, 24, 25, 26, 27, 28, 29, 44, 45
Veterans' Entitlements Act 1986

Antico v C.E. Health Casualty & General Insurance (1996) 38 NSWLR 681
Australian Telecommunications Commission v Treloar (1989) 11 AAR 69
J & G Knowles v Commission of Taxation (unreported, 3 March, 2000)
Minister for Immigration and Ethnic Affairs v Ozmanian (1996) 46 ALD 244; (1996) 141 ALR 322; (1996) 71 FCR;  [(1996) 125 FLR 270]
Repatriation Commission v Bendy (1989) 10 AAR 323
Rothwell v Caverswall Stone Co. Ltd [1944] 2 All ER 350

DECISION AND REASONS FOR DECISION [2000] AATA 243

ADMINISTRATIVE APPEALS TRIBUNAL     )
  )          Q1999/679
GENERAL ADMINISTRATIVE DIVISION      )

Re                  PAUL RUSSELL

Applicant

And                COMCARE

Respondent

DECISION

Tribunal  Miss S A Forgie (Deputy President)

Date  27 March, 2000

Place  Brisbane

DecisionThe Tribunal affirms the decision of the Respondent dated 29 April, 1999.

S A FORGIE

Deputy President

REASONS FOR DECISION

On 21 June, 1999, the applicant, Mr Paul James Russell, applied for review of a decision of a delegate of the respondent, Comcare, dated 29 April, 1999. That decision affirmed an earlier determination dated 3 February, 1999 to the effect that Mr Russell was not entitled to any payment under ss. 24 and 27 of the Safety, Rehabilitation and Compensation Act 1988 ("the Act").  He had lodged a claim for a lump sum payment for permanent impairment for major depressive disorder.

1. At the hearing, the documents lodged pursuant to s. 37 of the Administrative Appeals Tribunal Act 1975 ("T documents") were admitted in evidence together with copies of an amended plaint lodged in proceedings between Mr Russell and the Commonwealth of Australia, Mr Russell's statement of loss and damage lodged in those proceedings and a deed of release and indemnity.  No oral evidence was called.

BACKGROUND

1. The facts relevant to the resolution of the preliminary issue were not in dispute between the parties.  I will set out those facts as I have found them to be established by the written material in evidence.

1. Mr Russell was born on 5 September, 1971 and joined the Australian Army in 1988.  On 1 July, 1994, he was taking part in a training exercise with the Army when he suffered a shrapnel wound to his left upper lateral buttock when a mortar exploded prematurely.  Mr Russell completed a claim for compensation on 3 November, 1994.  When asked what "injury or illness" he was claiming for, he wrote "Shrapnel wound to the lower back/L buttock (one wound)".  He wrote "L lower back/buttock" when asked what part of his body was affected.  When asked when the injury happened or when he first noticed the disease or illness, Mr Russell wrote "01 07 94".  That was the date on which he first received medical treatment for his injury or illness. (T documents, page 11)

1. Comcare accepted liability for that shrapnel wound on 23 November, 1994.  In a letter dated 6 February, 1995, Mr Russell asked Comcare to assess him for a lump sum payment for the injury he received as part of his employment with the Army.  On 21 February, 1995, Dr David Lewis, who is an orthopaedic surgeon, assessed Mr Russell as suffering from 10% permanent impairment under Table 9.2 of the Guide to the Assessment of the Degree of Permanent Impairment ("Guide") prepared by Comcare pursuant to s. 28 of the Act. Dr Lewis also assessed him as suffering from 20% permanent impairment under Table 9.5 of the Guide.

1. On 14 June, 1995, Mr Russell completed a non-economic loss questionnaire in which he answered questions relating to his pain and suffering, loss of amenities and other loss.  The accepted condition was described as a shrapnel wound left upper lateral buttock.  Mr Russell described such effects upon his life as those arising from his pain and the limitations upon his physical activities. 

1. On 14 June, 1995, Comcare wrote to Mr Russell advising him that it appeared that he had suffered a permanent impairment as a result of his compensable injury and that the degree of his whole person impairment was 20%. On that basis, the total amount of compensation payable to him would be $32,960.46, which comprised $20,600.29 under s. 24 for impairment and $12,260.17 under s. 27 for non-economic loss. Comcare advised Mr Russell that its letter was not a formal assessment or determination but that its purpose was to enable him to make an informed decision as to whether he wished to receive that compensation or to institute proceedings at common law. It advised him that, under s. 45 of the Act, he could elect to sue the Commonwealth if he believed that his permanent impairment had resulted from its negligence. If he did elect to sue, compensation would not be payable under either ss. 24 or 27.  On 30 June, 1995, Mr Russell made an election to sue the Commonwealth for damages at common law.   Mr Russell instituted proceedings in the District Court of Queensland in 1995. 

1. The reports of Dr Lewis dated 16 March, 1995 and 13 June, 1995, Professor Tess Crammond dated 9 October, 1996, 14 November, 1996 and 1 February, 1999 and Dr Tuffley dated 20 January, 1997 and 12 June, 1997 all support a finding that Mr Russell suffered extensive pain as a result of the shrapnel wound.  A finding that Mr Russell has a major depressive disorder associated with chronic pain resulting from his shrapnel wound is supported by the report of Dr Fraser, consultant psychiatrist, dated 30 September, 1997. 

1. In his Statement of Loss and Damage filed in those proceedings on 24 July, 1997, Mr Russell gave particulars of the pain and suffering he had experienced together with the loss of amenities caused by the injuries and the physical, social and recreational consequences of those injuries.  Details of severe pain and limitations were given.  Although he had engaged in many sports prior to the incident of 1 July, 1994, many physical activities were no longer open to him.  The Statement of Loss and Damage continued:

"… This lack of physical activity depresses the Plaintiff and frustrates him.
Since the accident, the Plaintiff has become moody and is easily irritated.  He feels constantly frustrated and trivial things can cause him to become extremely angry to the point of throwing objects. The Plaintiff is depressed about his current situation and has contemplated suicide.

Prior to the incident, the Plaintiff had a busy social life. He enjoyed visiting with friends and going out to pubs and nightclubs. He also had a great deal of social interaction via his sporting activities. The Plaintiff no longer enjoys social activities. He feels embarrassed by his disabilities and has become withdrawn and self conscious. He has difficulty in interacting with new people.

Prior to the incident, the Plaintiff was involved in a long term relationship. This relationship has now broken up due to the stress caused by the Plaintiff's injuries." (Exhibit B, pages 6-7)

1. On 12 December, 1995, a plaint was filed in those proceedings.  That  plaint was amended on 1 October, 1998, where Mr Russell claimed for "non-economic loss damages including aggravated and exemplary damages for personal injuries suffered by the Plaintiff as a result of negligence, and or breach of duty and or breach of contract and or breach of statutory duty…" on the part of the Commonwealth, its servants or agents (Exhibit A).  The personal injuries set out in the amended plaint were:

"(i)      a severe compound fragment wound to the left buttock and hip region; and

(ii)unsightly scarring to the left buttock region; and

(iii)a severe nerve disruption in relation to the left buttock and left hip region." (Exhibit A, page 4)

1. An agreement was reached on 17 February, 1998 between Mr Russell and the Commonwealth settling the claim for damages Mr Russell had instituted for an injury as detailed in the assessment of Permanent Impairment.  The Commonwealth agreed to pay Mr Russell the sum of $57,500.00 (less the sum of $552.15 to the Health Insurance Commission) together with his costs in the sum of $13,894.50.  The Commonwealth also agreed to pay a further sum of $1,800.00 to the Health Insurance Commission.  For his part, Mr Russell agreed to accept the payment in full and final satisfaction and settlement of his claim for damages save for any statutory rights under the 1988 Act.  He also released and quit any claim against the Commonwealth for all injury or loss sustained, or claimed to have been sustained, as a result of the incident on 1 July, 1994. (Exhibit C).

1. On 4 June, 1998, a delegate of Comcare wrote to Mr Russell and advised him that he had determined that he had "… suffered an injury arising out of, or in the course of,  your military service and that liability be extended to include burning dysthesia in your left buttock on 10 April 1997, being the date of Dr Tuffley's report and major depressive disorder associated with chronic pain on 30 September 1997, being the date of Dr Fraser's report." (T documents, page 48).

THE ISSUE

1. There was no dispute between the parties that Mr Russell suffers from a major depressive disorder. His condition is a consequence of his suffering a shrapnel wound on 1 July, 1994 while taking part in a training exercise as a member of the Australian Army. There is no question that both Mr Russell's shrapnel wound and his major depressive disorder arose out of, or in the course of, his employment within the meaning of the Act. The issue in this case is whether Mr Russell's shrapnel wound is to be regarded as an injury within the meaning of the Act and his major depressive order as a separate injury. If they are to be regarded as separate injuries, his election on 30 June, 1995 would be limited to his shrapnel wound and would not affect his entitlement to compensation in respect of his major depressive disorder.

LEGISLATIVE FRAMEWORK

1. Section 14 is concerned with compensation for injuries.  Sub-section 14(1) provides that:

"Subject to this Part, Comcare is liable to pay compensation in accordance with this Act in respect of an injury suffered by an employee if the injury results in death, incapacity for work, or impairment."

Compensation is not payable in respect of an injury that is intentionally self-inflicted (s. 14(2)(b)).  If it is not intentionally self-inflicted, compensation is not payable in respect of an injury that is caused by the serious and wilful misconduct unless the injury results in death or serious and permanent impairment (s. 14(3)).

1. Part II of the Act then goes on to provide for compensation for specific property loss or damage (s. 15), medical expenses (s. 16) and household and attendant (s. 29).  It deals specifically with compensation payable where an injury results in death (ss. 17 and 18), where a person is incapacitated for work as a result of an injury (ss. 19-22) and where an injury results in permanent impairment (ss. 24-27).

1. A reference to "an incapacity for work" is defined in s. 4(9) to mean:

"… an incapacity suffered by an employee as a result of an injury, being:

(a)an incapacity to engage in any work; or

(b)an incapacity to engage in work at the same level at which he or she was engaged by the Commonwealth … in that work or any other work immediately before the injury happened."

1. The expression "permanent impairment" is not defined but each word is defined separately.  The word "permanent" is defined to mean "… likely to continue indefinitely…" (s. 4(1)) and "impairment" to mean "… the loss, the loss of the use, or the damage or malfunction, of any part of the body or of any bodily system or function or part of such system or function" (s. 4(1)).

1. Other than in respect of loss or damage to property, entitlement to compensation is, in each instance, dependent upon there having been an injury.  The term "injury" is defined in s. 4(1) to mean:

"(a)     a disease suffered by an employee; or

(b)an injury (other than a disease) suffered by an employee, being a physical or mental injury arising out of, or in the course of, the employee's employment; or

(c)an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee's employment), being an aggravation that arose out of, or in the course of, that employment;

but does not include any such disease, injury or aggravation suffered by an employee as a result of reasonable disciplinary action taken against the employee or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment".

The word "disease" is defined to mean:

"(a)     any ailment suffered by an employee; or

(b)the aggravation of any such ailment;

being an ailment or aggravation that was contributed to in a material degree by the employee's employment by the Commonwealth or a licensed corporation". (s. 4(1))

An "ailment" is, in turn, defined to mean "… any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development" (s. 4(1)).  Each of the meanings given in s. 4(1) is to be given to the words in the Act "… unless the contrary intention appears …".

1. In relation to permanent impairment, s. 24 provides that:

"(1)     Where an injury to an employee results in a permanent impairment, Comcare is liable to pay compensation to the employee in respect of the injury.

(2)       …

(3)       Subject to this section, the amount of compensation payable to the employee is such amount, as is assessed by Comcare under subsection (4), being an amount not exceeding the maximum amount at the date of the assessment.

(4)       The amount assessed by Comcare shall be an amount that is the same percentage of the maximum amount as the percentage determined by Comcare under subsection (5).

(5)       Comcare shall determine the degree of permanent impairment of the employee resulting from an injury under the provisions of the approved Guide.

(6)       The degree of permanent impairment shall be expressed as a percentage.

(7)       Subject to section 25, where Comcare determines that the degree of permanent impairment of the employee is less than 10%, an amount of compensation is not payable to the employee under this section.

(8)       …

(9)       …"

1. Sub-section 7(6) provides that:

"An incapacity for work or impairment of an employee shall be taken, for the purposes of this Act, to have resulted from a disease, or an aggravation of a disease, if, but for that disease or aggravation, as the case may be:

(a)the incapacity or impairment would not have occurred;

(b)the incapacity would have commenced, or the impairment would have occurred, at a significantly later time; or

(c)the extent of the incapacity or impairment would have been significantly less."

1. Section 25 provides that Comcare may make an interim determination of a person's degree of permanent impairment and assess an amount of compensation payable to him or her. Comcare may only do that if it makes a determination that an employee is suffering from a permanent impairment as a result of an injury and, although it has not made a final determination of the degree of permanent impairment, is satisfied that the degree is equal to or more than 10%. Where Comcare has made a final assessment of the degree of an employee's permanent impairment, s. 25(4) provides that "… no further amounts of compensation shall be payable to the employee in respect of a subsequent increase in the degree of impairment, unless the increase is 10% or more." (s. 25(4))

1. The approved Guide referred to in s. 25 is that prepared by Comcare, (and approved by the Minister), in accordance with s. 28 under the title of "Guide to the Assessment of the Degree of Permanent Impairment".  That Guide sets out:

"(a)     criteria by reference to which the degree of the permanent impairment of an employee resulting from an injury shall be determined;

(b)criteria by reference to which the degree of non-economic loss suffered by an employee as a result of an injury or impairment shall be determined; and

(c)methods by which the degree of permanent impairment and non-economic loss, as determined under those criteria, shall be expressed as a percentage." (s. 28(1))

In preparing criteria for the purposes of ss. 28(1)(a) and (b), Comcare is required to have regard to "… medical opinion concerning the nature and effect (including possible effect) of the injury and the extent (if any) to which impairment resulting from the injury or impairment, may reasonably be capable of being reduced or removed." (s. 28(6))

1. The Guide sets out principles of assessment.  In relation to impairment and non-economic loss, it provides:

"Impairment means 'the loss, loss of use, damage or malfunction, of any part of the body, bodily system or function or part of such system or function'. It relates to the health status of an individual and includes anatomical loss, anatomical abnormality, physiological abnormality and psychological abnormality. Throughout this guide emphasis is given to loss of function as a basis of assessment of impairment and as far as possible objective criteria have been used.

Impairment is measured against its effect on personal efficiency in the 'activities of daily living' in comparison with a normal healthy person.  The measure of 'activities of daily living' is a measure of primary biological and psychosocial function such as standing, moving, feeding and self care.

Non-economic loss, which is assessed in accordance with Part B of the Guide, is a subjective concept of the effects of the impairment on the employee's life. It includes pain and suffering, loss of amenities of life, loss of expectation of life and any other real inconveniences caused by the impairment.

Whilst 'activities of daily living' are used to assess impairment they should not be confused with 'lifestyle effects' which are used to assess non-economic loss. 'Lifestyle effects' are a measure of an individual's mobility and enjoyment of, and participation in, recreation, leisure activities and social relationships. It is emphasised that the employee must be aware of the losses suffered. While employees may have equal ratings of impairment it would not be unusual for them to receive different ratings for non-economic loss because of their different lifestyles." (page 3)

1. The Guide goes on to explain that its assessment is based "… on the concept of 'whole person impairment'….  Evaluation of a whole person impairment is a medical appraisal of the nature and extent of the effect of an injury or disease on a person's functional capacity and activities of daily living." (page 4) 

1. The Guide is "… is structured by assembling detailed descriptions of impairments into groups according to body system and expressing the extent of each impairment as a percentage value of the functional capacity of a normal healthy person.  Thus a percentage value can be assigned to an employee's impairment by reference to the relevant description in this guide." (page 4)  Examples of the groups into which impairments are gathered are cardio-vascular system (Tables 1.1-1.3), respiratory system (Tables 2.1-2.2), musculo-skeletal system (Tables 9.1-9.6) and neurological function (Tables 12.1-12.5).  Table 5.1 is concerned with psychiatric conditions.  The note at the head of the table states that it:

"Includes psychoses, neuroses, personality disorders and other diagnosable conditions.  The assessment should be made on optimum medication at a stage where the condition is reasonably stable."

1. The concepts of employability and incapacity are not dealt with in the Guide and so are not included in the assessment of impairment and non-economic loss.  Incapacity, the Guide explains, is influenced by factors other than the degree of impairment and is compensated by weekly payments which are in addition to payments for permanent impairment (page 3).

1. Subject to s. 45, an action for damages does not lie against the Commonwealth in respect of:

"(a)     an injury sustained by an employee in the course of his or her employment, being an injury in respect of which the Commonwealth, Commonwealth authority or licensed corporation would, but for this subsection, be liable (whether vicariously or otherwise) for damages; or

(b)the loss of, or damage to, property used by an employee resulting from such an injury;

whether that injury, loss or damage occurred before or after the commencement of this section." (s. 44(1))

1. The exception in s. 45 applies in situations in which compensation is payable under ss 24-27.  Each of those sections is concerned with payment for permanent impairment.  If the Commonwealth would, but for s. 44(1):

"…     be liable for damages for any non-economic loss suffered by the employee as a result of the injury;

the employee may, at any time before an amount of compensation is paid to the employee under section 24, 25 or 27 in respect of that injury, elect in writing to institute an action or proceeding against the Commonwealth … for damages for that non-economic loss." (s. 45(1))

1. The effect of an election is set out in s. 45(2) which provides:

"Where an employee makes an election:

(a)subsection 44(1) does not apply in relation to an action or other proceeding subsequently instituted by the employee against the Commonwealth … for damages for the non-economic loss to which the election relates; and

(b)compensation is not payable after the date of the election under section 24, 25 or 27 in respect of the injury.

(3)An election is irrevocable.

(4)       In any action or proceeding instituted as a result of an election made by an employee, the court shall not award the employee damages of an amount exceeding $110,000 for any non-economic loss suffered by the employee."

CONSIDERATION

1. Mr Pope submitted that the scheme of the Act rests on the notion of injury whereas a common law action rests on the notion of a cause of action. In the common law action instituted by Mr Russell, his claim had been for damages (limited to non-economic loss) for personal injuries suffered as a result of the Commonwealth's negligence or breach of duty, contract or statutory duty. His claim had covered all heads of damage and he cannot revisit it to claim further heads. In adopting an injury as its basis and in defining an "injury" in terms of alternatives, rather than in a cumulative sense, the Act has clearly recognised that a person may suffer from quite distinct injuries. In terms of this case, Mr Pope submitted, Mr Russell had first suffered the shrapnel wound, which was an injury as it was a physical injury arising out of, or in the course of, his employment. He had also suffered, although at a later time, an ailment that was contributed to in a material degree by his employment by the Commonwealth. That ailment was a disease and so, Mr Pope continued, an injury within the meaning of the Act. It was an injury separate from the first. As an election made under s. 45(1) is focused upon "that injury" in relation to which compensation is payable under ss. 24, 25 or 27, the effect of that election is limited to the injury known at the time.

1. If Mr Pope's submission is correct, it would mean that I would first need to consider whether Mr Russell's depressive disorder is an injury within the meaning of the Act. I have already set out the definition of an "injury".  A disease may be an injury by virtue of that definition.  A depressive disorder is a
   disease. If it is to be considered a disease within the meaning of the Act and so an injury, his employment with the Commonwealth must have contributed to it in a material degree. Davies J considered what was required to establish a contribution in a material degree in Australian Telecommunications Commission v Treloar (1989) 11 AAR 69 (Davies J). A similar concept appears in the Veterans' Entitlements Act 1986 and Davies J had considered that in Repatriation Commission v Bendy (1989) 10 AAR 323. He said in Treloar:

"In Bendy's case, I said (at 325):

'In Repatriation Commission v Law (1981) 147 CLR 635 at 648, Aickin J, with whom Gibbs CJ, Stephen and Mason JJ agreed, when considering provisions of the Repatriation Act 1920 (Cth) accepted that it was sufficient if war service was one of a number of causes of a disease provided that it was a contributing cause. I have myself, on occasions, used the term 'material contribution' in this context. The adjective 'material' is not necessary but its use is familiar. See, for example, Clover, Clayton & Co Ltd v Hughes [1910] AC 242, per Lord Loreburn at 247; Hetherington v Amalgamated Collieries of WA Ltd (1939) 62 CLR 317, per Latham CJ at 328; Adelaide Stevedoring Co Ltd v Forst (1940) 64 CLR 538, per Rich ACJ at 564, Dixon J at 567, 568, McTiernan J at 571, 572. The expression 'contributed in any material degree' was used in the Workers' Compensation Act 1958 (Vic) and is used in s 9(1)(e) of the Veterans' Entitlements Act and in s 7(3) of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth). In each case, the reference to materiality serves to make it clear that the contribution required is a contribution of a causal nature, that a contribution which is de minimis, which did not influence the course of events or which is so tenuous as to be immaterial is to be ignored. The term 'material' is here used not in the loose sense set out in definition 12 of the Macquarie Dictionary, namely, 'of substantial import or much consequence' but rather in its legal sense of 'pertinent' or 'likely to influence'.'

I remarked in Bendy's case, and have said on other occasions, for example, Westgate v Australian Telecommunications Commission (1987) 17 FCR 235 at 240; 7 AAR 529 at 534, that it is sufficient that the employment contribute to the contraction, aggravation, acceleration or recurrence of the disease. The contributing factor need do no more than contribute in a material way. The factor is not required to be the real, proximate or effective cause of the disease or of its development. When several separate factors together cause the contraction of a disease or its acceleration, aggravation or recurrence, all that is required is that one such factor exhibits the necessary connection with the worker's employment. The Tribunal was, however, in error in holding that a contribution brought about by the employment, however small, was sufficient. A contribution which is so small as to be immaterial, which has no causal significance, is not sufficient. A disease or an aggravation, acceleration or recurrence thereof is not attributable to employment unless it is causally connected therewith. As s 29 states, employment must be a contributing factor to the contraction of the disease or to the aggravation, acceleration or recurrence thereof." (pages 71-72)

1. In the case of Mr Russell's depressive disorder, he developed the condition as a result of suffering chronic pain from his shrapnel wound. His shrapnel wound arose out of, or in the course of, his employment. But for his being engaged in the activities of his employment, he would not have suffered the shrapnel wound and would not have developed a depressive disorder associated with pain from that wound. His employment contributed materially to his developing a depressive disorder. It would follow that Mr Russell's depressive disorder meets the criteria of the definition of a disease and so may be an injury within the meaning of the Act.

1. Does that conclusion assist me in resolving the issue in this case?  It seems to me that it does not, of itself, do so.  The starting point must be to determine  the precise nature and effect of the election made by Mr Russell.  An election may made "before an amount of compensation is paid to the employee under section 24, 25 or 27 in respect of that injury" (s. 45(1), emphasis added).  To determine the injury to which the words "that injury" refer, I need to go back to the two conditions that must be satisfied before an election may be made. They are set out in ss. 45(1)(a) and (b).  The first, set out in s. 45(1)(a), is that "compensation is payable under section 24, 25 or 27 in respect of an injury" (emphasis added). The second, set out in s. 45(1)(b), is that the Commonwealth would, but for the prohibition upon such an action by virtue of s. 44(1), "be liable for damages for any non-economic loss suffered by the employee as a result of the injury". Although it might be wished that those drafting the Act had used only one definite article to describe the injury in s. 45(1), it seems to me that both "the injury" and "that injury" as they appear in s. 45(1) refer back to "an injury" in respect of which compensation must be payable under ss. 24, 25 or 27 before an election may be made at all.

1. Once an election is made, the consequences are set out in s. 45(2).  The prohibition against an action for damages found in s. 44(1) does not apply in relation to an action "for damages for the non-economic loss to which the election relates" (s. 45(2)(a)).  After the date of the election, compensation is not payable "under section 24, 25 or 27 in respect of the injury" (s. 45(2)(b)).

1. The election is not made in respect of an injury, the injury or that injury as such.  An employee may "elect in writing to institute and action … against the Commonwealth … for damages for that non-economic-loss" (s. 45(1), emphasis added).  The reference to "non-economic-loss" is not a reference to the compensation payable under ss. 24, 25 and 27 in respect of "that injury".  It is a reference to "any non-economic loss suffered by the employee as a result of the injury" (s. 45(1)(b)). That is the natural reading of s. 45(1) and, in any event, compensation payable under ss. 24, 25 and 27 cannot be taken to be damages for non-economic loss. The Act itself distinguishes between compensation for impairment and compensation for non-economic loss. It does so in the language of ss. 24 and 25 on the one hand and s. 27 on the other and also draws the distinction in s. 28 relating to the compilation of the Guide. 

1. In so far as the consequences of an election are concerned, the distinction between impairment and non-economic loss is irrelevant.  Compensation is not payable "under section 24, 25 or 27 in respect of the injury" (s. 45(2)(b)).  No distinction is made between the types of compensation.  The words "the injury" refer back to "an injury" in respect of which compensation is payable under ss. 24, 25 or 27. 

1. What do the words "in respect of" add in the context of s. 45(2)(b)?  As Sackville J, with whom Jenkinson and Kiefel JJ said in Minister for Immigration and Multicultural Affairs v Ozmanian  (1996) 46 ALD 244:

"… the words 'in respect of' are themselves broad.

In Trustees Executors & Agency Co Ltd v Reilly [1941] VLR 110 at 111, Mann CJ said that the:

words 'in respect of' are difficult of definition, but they have the widest possible meaning of any expression intended to convey some connection or relation between the two subject matters to which the words refer.

See State Government Insurance Office (Queensland) v Crittenden (1966) 117 CLR 412 at 416; [1967] ALR 237, per Taylor J, where these observations were cited with approval. It is true that, like all statutory expressions of wide import, the meaning of the phrase 'in respect of' must depend on the legislative context: State Government Insurance Office v Rees (1979) 144 CLR 549 at 560-1, per Mason J; Workers' Compensation Board of Queensland v Technical Products Pty Ltd (1988) 165 CLR 642 at 646-7; 81 ALR 260, per Wilson and Gaudron JJ.  …" (page 257) 

1. To those authorities could be added Antico v C.E. Heath Casualty & General Insurance (1993) 38 NSWLR 681 at 696 (per Kirby P) and J & G Knowles v Commissioner of Taxation (unreported, 3 March, 2000, Heerey, Merkel and Finkelstein JJ). In the context of s. 45(2)(b), the words "in respect of" simply relate the compensation payable under ss. 24, 25 and 27 with the injury to which reference is made throughout s. 45.

1. In summary, then, no compensation is payable under ss. 24, 25 or 27 in respect of an injury after an election has been made to institute an action against the Commonwealth for damages for non-economic loss in respect of that injury where two conditions are satisfied. First, compensation must be payable under ss. 24, 25 or 27 in respect of that injury and second, but for s. 44(1), the Commonwealth must be liable to pay damages for any non-economic loss suffered by the employee as a result of that injury. Having made an election, a person has no rights under ss. 24, 25 or 27.   It makes no difference whether a person actually receives damages for a permanent impairment in the action for damages or whether he or she does not.  Further, it makes no difference that a permanent impairment was apparent at the time of the election or only manifested itself at a later time and after the damages claim has been settled or determined. 

1. Returning to Mr Russell's case, he made his election to institute such an action for damages in respect of non-economic loss in respect of what was described in Comcare's letter of 14 June, 1995 as the "compensable injury" (T documents, page 28).  The compensable injury was "shrapnel wound left upper lateral buttock" (T documents, page 14). Compensation was payable under ss. 24, 25 or 27 of the Act in respect of that injury. But for s. 44(1), the Commonwealth would have been liable to pay damages for any non-economic loss suffered by the employee as a result of that injury. As the conditions for an election were fulfilled and the election made, no compensation is payable after 30 June, 1995, the date of the election, under ss. 24, 25 or 27 in respect of the shrapnel wound left upper lateral buttock. 

1. The next matter to consider is the compensation which would be payable under ss. 24, 25 or 27 if liability were unaffected by any election. In the context of this case, it is particularly important to consider what compensation would be payable under s. 24.  That section provides that Comcare is liable if the "injury … results in a permanent impairment" (s. 24(1)). The Act speaks of "a" permanent impairment resulting from the injury but there is nothing in the Act to limit the number of permanent impairments that may result from an injury. Indeed, the Guide recognises this when it states that:

"It is important to realise that impairment is system or function based and that a single injury or disease may give rise to multiple loss of function.  When more than one table applies to a single injury separate scores should be allocated to each functional impairment." (page 5)

Where an employee suffers more than one impairment, the values are not added but combined using the Combined Values Table appearing in the Guide (page 5).  There may, however, be occasions when a person suffers two or more injuries and they give rise to the same impairment.  If that is the case, a single rating only is given (Guide, page 5).

1. An "impairment" is defined in s. 4(1) of the Act. A major depressive disorder may be an impairment as it is defined as it is a malfunction of a part of a bodily system. If it is permanent, it may be a permanent impairment. Can a condition be both an injury and an impairment? The short answer to that question is that a condition may come within the terms of both of those definitions when no regard is had to the context in which the words "injury" and "impairment" are used and when no regard is had to the particular circumstances of a case.  When regard is had to both the context and the facts, a condition will be one or the other.  Unless a condition is itself both the injury and the impairment resulting from that injury, a condition will never be itself an injury while at the same time being an impairment resulting from a separate injury. 

1. When does an injury "result in" a permanent impairment?  The expression "results in" leads to the conclusion that there must be a causal link between the injury and the employee's permanent impairment.  The need to determine whether there is a causal link between an injury and the incapacity or impairment for which compensation is sought or whether there is a separate injury, is illustrated by the case of Rothwell v Caverswall Stone Co. Ltd. [1944] 2 All ER 350 (Court of Appeal, Luxmoore and du Parcq LJJ, Scott LJ dissenting). An employee had suffered an injury but, due to the negligence of the doctor at the hospital he attended, the fractured dislocation of his shoulder was not discovered. When his shoulder injury was discovered, it was too late for treatment to be successful. The issue before the Court was whether the employee's incapacity resulted from the injury that arose out of and in the course of his employment or whether it resulted from the negligence at the hospital. Scott LJ dissented on the basis that any decision that made recovery of compensation dependent upon the skill of a doctor would be contrary to the public policy upon which workers' compensation legislation is based. Negligent medical treatment following the injury could not, as a matter of law, be regarded as a novus actus interveniens.  That is to say, it could not be regarded as a new cause of the injury.  His Honour did not dissent on the basis that the issue is one of causation.

1. Luxmoore and du Parcq LJJ considered the issue of causation to be simply one of fact.  Whether or not the same conclusion would be reached today is not relevant.  It is the principles that are relevant.  In his judgement, du Parcq LJ set out the principles for determining that issue:

"In my opinion, the following propositions may be formulated upon the authorities as they stand: first an existing incapacity 'results from' the original injury if it follows, and is caused by, that injury, and may properly be held so to result even if some supervening cause has aggravated the effects of the original injury and prolonged the period of incapacity. If, however, the existing incapacity ought fairly to be attributed to a new cause which has intervened and ought no longer to be attributed to the original injury, it may properly be held to result from the new cause and not from the original injury, even though, but for the original injury, there would have been no incapacity. Secondly, negligent or inefficient treatment by a doctor or other person may amount to a new cause and the circumstances may justify a finding of fact that the existing incapacity results from the new cause, and does not result from the original injury. This is so even if the negligence or inefficient treatment consists of an error of omission whereby the original incapacity is prolonged. In such a case, if the arbitrator is satisfied that the incapacity would have wholly ceased but for the omission, a finding of fact that the existing incapacity results from the new cause, and not from the injury, will be justified." (page 365)

1. Whether a particular condition is an injury or an impairment resulting from an election becomes a matter of characterisation according to the facts and the framework of the Act. Applying these principles in Mr Russell's case, regard must be had to the order of events. First came the shrapnel injury. That was clearly an injury within the meaning of the Act as it arose out of, or in the course of, his employment. A great deal of pain was, and is, associated with his injury. There followed from that the development of a major depressive disorder. Mr Russell's major depressive disorder is attributable to his injury. There is a chain of causation between the two and it is unbroken by any supervening event that has occurred in the course of his employment or otherwise. In those circumstances, his depressive disorder may be characterised as a condition caused by, and so resulting from, the injury which was the shrapnel wound. As Mr Russell's depressive disorder is a permanent condition and is a malfunction of his bodily system, it may be concluded that his injury has resulted in a permanent impairment.

1. How does this conclusion sit with the conclusion that Mr Russell's major depressive disorder may also be regarded as a disease, and so an injury, within the meaning of the Act? As I have said earlier, it is a matter of characterisation and causation. While it can be said that Mr Russell's major depressive disorder was "contributed to in a material degree" by Mr Russell's employment, he would not have suffered it had he not first suffered the shrapnel wound.  Properly characterised, Mr Russell's depressive disorder was a consequence of an injury.  It cannot be treated as a disease, and so an injury, that was contributed in a material degree by his employment independently of his shrapnel wound.  It was an impairment resulting from an injury and was not of itself an injury.  It was but one of the consequences which revealed themselves over time and which were permanent impairments.

1. As Mr Russell made his election to institute an action for damages in respect of non-economic loss in respect of shrapnel wound left upper lateral buttock, a consequence of that election is that compensation is no longer payable under ss. 24, 25 or 27 in respect of that injury and so in respect of permanent impairments that result from that shrapnel wound. As his major depressive disorder has resulted from that shrapnel wound and is a permanent impairment resulting from that shrapnel wound, compensation under the Act is not payable in respect of it after 30 June, 1995. That is the effect of Mr Russell's having made an election under s. 45(1). Had Mr Russell not made the election, he might have been entitled to further compensation if the impairment subsequently increased by more than 10% in accordance with s. 25(4).  As he made his election, Mr Russell is limited to the impairments foreseeable at the time of the settlement.  That is one of the risks that is inherent in electing to pursue a common law claim.

1. Although, it makes no difference whether a person actually receives damages for a permanent impairment that was either apparent at the time of the election or later manifests itself, I note that the symptoms of Mr Russell's major depressive disorder had been identified in the Statement of Loss and Damage lodged in the District Court. 

1. Mr Russell's election does not affect his right to claim medical expenses for his treatment or any claim in respect of incapacity for work.  Those issues were not under consideration in this case.

1. For the reasons I have given, Mr Russell is not entitled to claim a lump sum payment for permanent impairment for a major depressive disorder. Consequently, I affirm the decision of the respondent dated 29 April, 1999.

I certify that the fifty preceding paragraphs are a true copy of the reasons for the decision herein of Miss S A Forgie (Deputy President)

Signed:          ......................................
  M Martinez    Associate

Date of Hearing  15 February, 2000
Date of Decision   27 March, 2000
Counsel for the Applicant            Mr M Pope
Solicitor for Applicant                 Wilson Ryan & Grose
Counsel for the Respondent        Mr R Derrington
Solicitor for the Respondent        Blake Dawson Waldron